ASUNCION, June 15 (Reuters) - At least seven police officersand nine peasant farmers were killed in armed clashes on Fridayduring a land eviction in Paraguay, marking one of the worstsuch incidents in the country for two decades.

Leftist President Fernando Lugo deployed troops to supportlocal police. He ruled out any links between the incident andthe Paraguayan People's Army, a small leftist group that hasstaged a series of raids on rural police posts in recent years.

The peasants shot at the officers when they arrived to evictthem from a privately owned farm in the Canindeuyu district,some 240 kilometers (150 miles) from the capital, and theyreturned fire, officials said.

"Seven police have been killed in this operation. Up untilnow we've seen about nine deaths among the peasant farmers whowere occupying the property," Interior Minister Carlos Filizzolatold reporters.

The army chief said 150 soldiers had been sent to the ruralarea near the Brazilian border, dominated by sprawling soyfields, cattle ranches and illegal marijuana plantations.

The roughly 2,000-hectare (4,900-acre) farm where theviolence took place is owned by a local businessmen whocomplained that a group of about 100 families had invaded hisproperty about three weeks ago.

Peasant rights group say the land was distributed during the35-year dictatorship of Alfredo Stroessner, when allies of hisregime were rewarded with vast tracts of prime farmland in thelandlocked nation of six million people.

Conflicts over land have increased in recent decades duepartly to increased soybean farming in the world's No. 4exporter of the oilseed. Ranching has also spread into areasthat used to be relatively free from large-scale agriculture.

Lugo, a former Roman Catholic bishop who spent years servingin the north of the country, suspended his agenda and called acabinet meeting to evaluate the violence.

One of his election pledges was sweeping agrarian reform buthis plans to redistribute land stalled as the state struggled toreach agreement between peasant farmers demanding specifictracts and landholders willing to sell them.

The opposition's hold on Congress has also complicated hisreform agenda.